Author Archives: NYSLRS

NYSLRS Membership Basics

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Whether you just joined or you’re a longtime member, you likely have questions about your NYSLRS membership. What is vesting? What are final average earnings? What tier are you in, and why does it even matter?

NYSLRS Membership

Basic Concepts of NYSLRS Membership

While NYSLRS administers many different retirement plans, the core concepts of our memberships are the same. Your pension will be calculated using a preset formula based on your earnings and years of service. To better understand your NYSLRS benefits, you should become familiar with these four basic concepts:

  • Tier. Your tier is based on the date you joined NYSLRS and helps determine the benefits available to you. If you’re a new NYSLRS member, you’re likely in Tier 6. Tier 6 members joined NYSLRS on or after April 1, 2012.
  • Service Credit. Generally, you earn a year of service credit for each year you work for a participating NYSLRS employer. Part-time work is prorated. Your total service credit at retirement is a major factor in determining the amount of your pension.
  • Vesting. You become vested after you earn five years of service credit. It’s a significant milestone, because once you’re vested, you’re eligible for a NYSLRS pension when you reach retirement age, even if you leave public service.
  • Final Average Earnings. Final average earnings are the average of your earnings during the period when your pay is highest. It’s another major factor in determining the amount of your pension.

Your NYSLRS Pension and Other Benefits

As a NYSLRS member, you are part of a defined benefit retirement plan. This means your NYSLRS pension will be a lifetime benefit based on your final average earnings and service credit, not on the contributions you make toward your retirement.

Your NYSLRS membership also provides other important benefits, including:

More Information

We want to make sure you have the information you’ll need to plan for your retirement and make critical decisions about your future. Here are some resources available to you:

Retirement Online is the quickest way to access account information such as your tier, retirement plan and estimated total service credit. If you don’t already have one, sign up for a Retirement Online account now.

Explore the NYSLRS website to learn more about your NYSLRS membership. Our Welcome New Members page explains more about the benefits that are available to you. Your retirement plan publication offers a comprehensive overview of your benefits, and you can find it with our Find Your NYSLRS Retirement Plan Publication tool.

If you have questions about your account or your NYSLRS benefits, please message us using our secure contact form.

Why Your Retirement Plan Publication Is So Important

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Your plan publication is an essential resource that you should consult throughout your career. It will help you plan for retirement and guide you when your retirement date draws near.

Reminder: you can use this tool to help you find your retirement plan publication.

Let’s explore the information you’ll find in your plan publication and what it means.

retirement plan publication

About Your Membership

This section has basic information about your membership, including your tier, contributions, when you will be eligible for a pension and how to withdraw your membership if you leave public employment.

Service Credit

Service credit is one of the main factors in determining your pension benefit amount. If you work full-time for the State or a participating municipal employer for 12 months, you’ll earn a year of service credit. If you work part-time, your service credit is prorated.

You’ll also find information about how your service credit is calculated, how to purchase credit for previous public employment or military service, how leaves of absence affect service credit, and how sick leave can be used for extra service credit at retirement.

Final Average Earnings

Final average earnings (FAE) are another major factor in determining the amount of your pension. Your FAE is the average earnings during the set of consecutive years (three or five years, depending on your tier and retirement plan) when your earnings were highest.

This section describes what types of payments are used in calculating your FAE and any limitations that may apply.

Service Retirement Benefits

This section describes your retirement eligibility and how your benefit is calculated. If you have questions about how much your pension will be, you should read this section.

Choosing a Pension Payment Option

You can choose from several options for the payment of your pension. Some payment options allow you to provide for your spouse or other beneficiary after you die in exchange for a reduction in your monthly payment. Consider each payment option carefully, as you’ll only have at most 30 days to change it after you retire.

Items That May Affect Your Pension

This section describes factors that can change the amount of your pension. For example, if you retire with an outstanding loan, your pension will be permanently reduced. Also, if you get a divorce, your ex-spouse may be entitled to a portion of your benefit.

A cost-of-living adjustment (COLA), on the other hand, would increase your benefit once you become eligible.

Vested Retirement Benefits

If you leave public employment before retirement age but have met the minimum service requirement to receive a pension, you can apply for a vested retirement benefit when you become eligible.

Disability and Death Benefits

Your NYSLRS benefits include more than a pension. If you are no longer able to perform your job because of a medical condition, you may be eligible for a disability retirement. If you die before retirement, your survivors may be eligible for a death benefit.

Receiving Your Benefits

Before you can receive your pension, you must file an application with the Office of the State Comptroller. This section describes the process of applying for your retirement benefits, including information about filing online.

ERS Tier 6 Milestones

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If you joined the Employees’ Retirement System (ERS) on or after April 1, 2012, you are a Tier 6 member. Let’s look at the milestones you will reach over the course of your public service career and how they will affect your benefits.

Why Milestones Matter

As a NYSLRS member, you earn service credit for your paid public employment. Generally, one year of full-time work equals one year of service credit. As you earn service credit, you’ll reach career milestones that will make you eligible for certain benefits or for improvements to your existing benefits. Understanding these milestones and when they occur will help you better plan your career and retirement.

Your milestones depend on your tier and your retirement plan. Most ERS Tier 6 members are in the Article 15 retirement plan (named for a section of the New York State Retirement and Social Security Law). If you see Plan A15 listed in the ‘My Account Summary’ section of your Retirement Online account or in your annual statement, you’re in this plan.

ERS Tier 6 milestones

Major Milestones for Tier 6

Here are some important milestones for Tier 6 members in the Article 15 retirement plan:

  • With ten years of service credit, you can apply for a non-job-related disability benefit if you are permanently disabled and cannot perform your duties because of a physical or mental condition.
  • With ten years of service credit, your beneficiaries may be eligible for an out-of-service death benefit if you leave public employment and die before retirement.
  • Ten years also marks the point when you are no longer able to withdraw your membership and receive a refund of your contributions if you leave public employment.
  • You are eligible to retire once you are age 55 and have five years of service credit. However, for most Tier 6 members, there would be reductions to your benefit if you retire before age 63.
  • You can retire with full benefits at age 63.
  • If you retire with fewer than 20 years of service, your pension will equal 1.66 percent of your final average earnings (FAE) for each year of service.
  • If you retire with more than 20 years of service, your benefit will equal 1.75 percent of your FAE for each year of service.
  • Then, for each year of service beyond 20 years, you will receive an additional 2 percent of your FAE.

Note: The law limits the final average earnings of all members who joined on or after June 17, 1971. For example, for most members, if your earnings increase significantly during the years used in your FAE, it’s possible that some of those earnings may not be used toward your pension. The specific limits vary by tier. Visit our Final Average Earnings page for more information.

The amount of your pension also depends on several factors, including your years of service credit and your age when you retire. Most members can estimate your pension in Retirement Online and enter different retirement dates to see how those choices would affect your benefit. As of April 9, 2022, Tier 5 and 6 members only need five years of service credit to be vested. If you are a Tier 5 or 6 member with between five and ten years of service credit, you can contact us to request a benefit estimate.

ERS Tier 6 Special Plans

Some public employees, such as corrections officers or deputy sheriffs, are in special retirement plans and can receive a pension after completing 20 or 25 years of service, regardless of age. If you are not in the Article 15 retirement plan described above, you should read your retirement plan publication to learn about your plan’s milestones.

Our Find Your NYSLRS Retirement Plan Publication tool can help. To use it, you just need to know your retirement plan code. You can find your code in the ‘My Account Summary’ section of your Retirement Online account homepage or on the second page of your latest Member Annual Statement. You can also use the new tool to search for your plan publication by retirement system, tier and occupation type (uniformed or non-uniformed).

NYSLRS – One Tier at a Time: ERS Tiers 3 and 4

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(We know that’s two, but let us explain.) When you join the New York State and Local Retirement System (NYSLRS), you’re assigned a tier based on your date of membership. There are six tiers in the Employees’ Retirement System (ERS) and five in the Police and Fire Retirement System (PFRS). Your tier determines such things as your eligibility for benefits, the calculation of those benefits, death benefit coverage and whether you need to contribute toward your benefits.

Our series, NYSLRS – One Tier at a Time, walks through each tier and gives you a quick look at the benefits in both ERS and PFRS. Today’s post looks at ERS Tiers 3 and 4. Of our current 650,251 ERS members, 263,561 are in Tiers 3 and 4, representing 40.5 percent of ERS membership.

Most ERS Tier 3 and Tier 4 members (unless they are in special retirement plans) retire under the Article 15 retirement plan. Check out the graphic below for the basic retirement information for Tiers 3 and 4 members in this plan.

ERS Tiers 3 and 4 - Article 15

Membership Milestones for ERS Tiers 3 and 4

ERS members in Tiers 3 or 4 need five years of service credit to become vested. Once vested, they’re eligible for a lifetime pension benefit as early as age 55. However, if they retire before the full retirement age of 62 with fewer than 30 years of service credit, their benefit will be reduced. Some Tier 3 and 4 members, such as sheriffs or correction officers, can retire with 20 or 25 years of service, regardless of age and without penalty.

You can check your service credit total and estimate your pension using Retirement Online. Most members can use our online pension calculator to create an estimate based on the salary and service information NYSLRS has on file for them. You can enter different retirement dates to see how your choices would affect your potential benefit.

For more information about Tier 3 and 4 membership, find your NYSLRS retirement plan publication. It’s a comprehensive description of the benefits provided by your specific plan.

What is a Defined Benefit Plan?

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As a NYSLRS member, you are enrolled in a defined benefit plan, also known as a traditional pension plan.

How a Defined Benefit Plan Works

Defined benefit pension plans provide a specified payment amount at retirement. If you are vested and retire from NYSLRS, you will receive a monthly pension payment for the rest of your life. Your pension will be calculated using a preset formula based on your earnings and years of service. Your individual contributions to NYSLRS will not affect the pension you receive when you retire.

Defined benefit plans are supported by contributions from both members and employers. With defined benefit plans, retirement assets are pooled and the investment risk is shared. These plans are usually administered by professional managers, whose long-term investment strategies help to reduce the impact of market turmoil. NYSLRS employs an experienced group of investment managers.

The biggest contributor to your pension plan is the New York State Common Retirement Fund. Over the past 20 years, the Fund’s investment returns have covered 75 percent of the cost of pensions.

understand your defined benefit plan

Defined Contribution Plans — And Their Risks

Defined benefit plans are often confused with 401(k)-style retirement savings plans, which are known as defined contribution plans.

With a defined contribution plan, the employee, the employer or both make contributions to an individual retirement account for the employee, and the money in the account is invested. In most cases, the employee decides how and where the money is invested (or the plan may offer pre-packaged investment options). At retirement, the employee will be able to draw from the accumulated value of contributions and investment returns, minus any fees.

The amount of money the employee has at retirement depends on the investment returns of the individual account. So, market downturns, especially near retirement, can negatively affect the value of the benefit. Employees depending on defined contribution plans run the risk of outliving their savings.

NYSLRS’ Defined Benefit Plans

NYSLRS administers more than 300 retirement plan combinations, but all of them are defined benefit plans and share certain features. NYSLRS plans:

  • Provide a guaranteed benefit for life;
  • Offer a pension based on final average earnings and years of service;
  • Provide a right to pension benefits (vesting) with five years of service credit;
  • Build a cost-of-living adjustment (COLA) into pensions to help offset the effect of inflation; and
  • Include disability retirement and death benefits.

We strongly encourage you to review your retirement plan publication for a complete description of your benefits. To find your retirement plan publication, visit our Find Your NYSLRS Retirement Plan Publication page and follow the steps listed.

Advantages of Defined Benefit Plans

Defined benefit plans provide important advantages for state and local government employers. For one, offering these plans makes it easier to recruit and retain qualified employees, particularly police officers, fire fighters and teachers. Employers can also reduce the risk of employee turnover, which could help cut training costs and improve productivity.

Defined benefit plans also help support state and local economies, because they provide a steady, reliable stream of retirement income for many retirees across New York and the nation.

Read more about the advantages of defined benefit plans.

Left Public Employment? Don’t Forget to File for Retirement

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If you expect to leave public employment before retirement age, or if you’ve already left, take note of this important information about your NYSLRS pension.

Once you become a vested NYSLRS member, you’re eligible for a NYSLRS pension even if you leave public employment before retirement age. Vesting is automatic but receiving retirement benefits is not. You’ll need to apply for your pension. But when should you apply?

Filing for Retirement If You Have Left Public Employment

Most NYSLRS members can begin collecting their pension as early as age 55. If you file for your retirement benefit between age 55 and your full NYSLRS retirement age, you may face a permanent benefit reduction. Full retirement age for a NYSLRS pension is 62 or 63, depending on your plan and tier.

retirement age for full benefits if you left public employment

Waiting longer than your full retirement age, however, could cost you a lot of money.

If you aren’t working for a NYSLRS participating employer, your NYSLRS pension will not increase after your full retirement age. Pension benefits are not retroactive, and you will not be able to recover the monthly pension payments that you would have received if you retired at full retirement age.

How Social Security and NYSLRS Rules Differ

NYSLRS and Social Security are different systems with different milestones. You can collect Social Security retirement benefits as early as age 62. If you delay taking Social Security, your benefit amount will continue to increase 8 percent per year until you reach age 70 (for those born in 1943 or later).

But if you wait until you’re 70 to apply for your NYSLRS pension, you’ll miss out on years of NYSLRS benefit payments.

The information above applies only to members who leave public employment before their full retirement age.

(In most cases, if you are still working for a participating public employer in New York State, your pension amount will continue to increase, even if you work past your retirement age.)

Steps You Can Take

Your retirement may be years or even decades in the future. Here are a few steps you can take to help you keep track of your NYSLRS pension if you leave public employment:

  • Estimate your NYSLRS pension at different ages using the benefit calculator in Retirement Online.
  • Create a plan for retirement, taking into account the milestones above.
  • Review your plan periodically and update it as necessary.
  • Keep your contact information up to date using Retirement Online.
  • Contact NYSLRS if you have questions about your benefits.

NYSLRS Membership by Tier

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NYSLRS, which administers the Employees’ Retirement System (ERS) and the Police and Fire Retirement System (PFRS), had 685,450 members as of March 31, 2022. Our members are State government, local government, school district and other public-sector employees from across New York — 650,251 in ERS and 35,199 in PFRS. About 74 percent of our members were active, which means they were on a public payroll as of March 31.

NYSLRS Membership Over Time

A decade ago, more than 80 percent of NYSLRS members were in Tiers 3 and 4. Now, those tiers represent less than 40 percent of our membership. Tier 6, which includes members who joined NYSLRS since April 1, 2012, now has 367,013 members, or 53.5 percent of total membership.

NYSLRS Membership by Tier

Here’s a look at our NYSLRS membership by tier, as of March 31:

Tier 1: NYSLRS’ oldest tier, whose members first joined the system before July 1, 1973 (July 31, 1973, for PFRS members), is dwindling. Tier 1 represented only 0.2 percent of our membership. There were only 1,043 Tier 1 ERS members and 17 Tier 1 PFRS members.

Tier 2: With 18,074 members, Tier 2 represented 2.6 percent of membership. Ninety-four percent of Tier 2 members were in PFRS.

Tiers 3 & 4: Tiers 3 and 4, which have similar retirement plans, had 263,734 members, 38.5 percent of the total membership. Tiers 3 and 4 are primarily ERS tiers. There is no Tier 4 in PFRS, and only 173 PFRS members were in Tier 3.

Tier 5: Tier 5 covers members who joined from January 1, 2010, through March 31, 2012. With 35,569 members, Tier 5 represented 5.2 percent of membership.

Tier 6: This tier covers members who joined since April 1, 2012. Its ranks grew by about 13 percent during the last fiscal year.

Why Your Tier Matters

Your tier is an essential component of your NYSLRS membership because it is one of the factors that determines your benefits. You can find out more by reading your retirement plan booklet. Our recent blog posts explain how to find your plan booklet and how to get the most out of it.

Welcome, New Members

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Welcome new members to the New York State and Local Retirement System (NYSLRS).

What is NYSLRS? NYSLRS administers retirement benefits for New York State employees and municipal and non-teaching school district employees outside of New York City. With nearly 1.2 million members, retirees and beneficiaries, NYSLRS is one of the largest public retirement systems in the nation.

NYSLRS is here to help you plan a financially secure retirement. Retirement may seem like a distant concern, but decisions you make now will have a big impact on your post-work life. Here are a few things you should do now as a new member:

Checklist for New Members

new members checklist

Learn About Defined Benefit Plans

Your NYSLRS pension is a defined benefit plan. This means that, once you are eligible and apply for retirement, you are guaranteed a monthly pension payment for the rest of your life. The amount of your payments will be calculated using a formula set by State law.

Defined benefit plans should not be confused with 401(k)-style retirement savings plans, which are known as defined contribution plans. The value of these plans is limited to the contributions made to an individual’s account and the investment returns on those contributions. And, unlike your NYSLRS pension, these plans do not guarantee a lifetime benefit.

While a 401(k)-style retirement savings plan can supplement a pension and Social Security benefits, it does not provide the same level of financial security as a defined benefit plan.

Sign Up for Retirement Online

If you haven’t already, sign up for a Retirement Online account. You can use Retirement Online to look up your estimated total service credit, name a beneficiary for your death benefit, purchase past service credit and more. This online tool will be an important resource throughout your career, especially as you plan for retirement when you can use our benefit calculator to estimate your pension.

Find Your Retirement Plan Publication

Your retirement plan publication is an essential resource that provides comprehensive information about your NYSLRS benefits. You can look up your specific plan using our Find Your NYSLRS Retirement Plan Publication tool. All you need is your benefit plan code and Tier, which you can find in Retirement Online.

Designate a Beneficiary

Your retirement plan provides you with a death benefit, so it’s important that you designate a beneficiary or beneficiaries. You can designate a beneficiary or beneficiaries through Retirement Online or by mailing us a Designation of Beneficiary form (RS5127).

Understand Service Credit

Your NYSLRS pension will be based on factors such as your tier, retirement plan, age at retirement, final average earnings and your service credit. You’ll earn one year of service credit for every year of full-time employment with a participating employer. Part-time employment is prorated. If you worked for a public employer or served in the U.S. armed forces before you were a member of NYSLRS, you may be eligible to receive credit for that past service. Because it is a major factor in calculating a NYSLRS pension, additional service credit would increase your pension in most cases. You can request this service through Retirement Online or by mailing us a Request to Purchase Service Credit (Including any Military Service) form (RS5042).

Start Saving for Retirement

Your pension is only one part of a secure financial future. It’s a good idea to save additional money for retirement. Healthy retirement savings will give you more flexibility to do the things you want to do in retirement. They also can be a hedge against inflation and a source of cash in an emergency. You don’t want to wait to start saving; the sooner you do, the more time your money has to grow.

More Information

Visit our Welcome New Members page for more information about NYSLRS and your benefits.

Retirement Online for Retirees

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More than 427,000 members and retirees are using Retirement Online — a secure and convenient way to do business with NYSLRS.

Retirement Online for Retirees

You can use Retirement Online to:

View Your Benefit Information

Review the most up-to-date information about your account. Check on the details of your pension and review deductions.

Generate an Income Verification Letter

You may need to prove your pension income for any number of reasons, such as applying for a mortgage or renting an apartment. With Retirement Online, you can generate an income verification letter any time you need one.

Update Your Contact Information

Moving? Changing your phone number or email address? It’s easy to keep NYSLRS updated so you won’t have to worry about missing important news and information about your benefits.

Snowbirds, take note. You can schedule an address change so you get NYSLRS mail at your seasonal home without interruption. This will ensure that you get your 1099-R tax forms in time to file your tax return.

Manage Your Beneficiaries

You can change the beneficiary for your post-retirement death benefit or change the contact information for an existing beneficiary.

Retirement Online makes it easy to view your beneficiary selections and submit changes instantly.

New Retiree Features Coming in January

We continue to improve and expand the services Retirement Online offers. In fact, this January, we’re adding new retiree features. They’re designed to give you greater insight into your retirement account and enable you to conduct business with your Retirement System without having to mail in forms or make a phone call.

Retirement Online for Retirees – New FeatureManage Your Direct Deposit

Ninety-five percent of NYSLRS retirees already receive their pension payments with direct deposit, and it’s about to get even more convenient. Soon, you’ll be able to use Retirement Online to update your bank account information. Whether you’ve switched banks, need to update your account details or want to add a joint account holder, you’ll be able to make those changes online.

Are you still receiving your pension by check? You’ll soon be able to sign up for direct deposit through Retirement Online and get your money faster.

Retirement Online for Retirees – New FeatureChange Your Federal Tax Withholding

If you need to adjust the amount of federal tax withholding coming out of your pension payments, you’ll be able to sign in to your account to update your filing status, change your dependents or make other adjustments to your withholding.

Retirement Online for Retirees – New FeatureView a “Pay Stub” of Your Pension Payment

Right now, you can look up your current monthly benefit details in Retirement Online, but soon you’ll be able to access full “pay stubs” for your payments from January 2023 onward by clicking the date of the payment you want to view. You’ll also be able to track year-to-date totals.

How to Get Ready

If you don’t have a Retirement Online account, now is a great time to sign up. Click “Sign Up” on our Retirement Online Sign-In page to get started. If you need help, we have step-by-step instructions on registering for your account and how to sign in for the first time. You may also find our Retirement Online Tools and Tips blog post helpful.

Retirement Online is secure and safe to use. When you sign up for an account, for security reasons, you will be asked to identify yourself, confirm your Social Security number, verify your identity and create credentials. Retirement Online also uses a two-step sign-in process for secure sign in. Remember, one of the best ways to prevent online fraud is for you to open your Retirement Online account using the personalized credentials you choose. That simple step will prevent any fraudster from trying to open an account in your name, whether it’s Retirement Online or any other online account.

Already have an account? Sign in and make sure your email and mailing address are current to ensure that you receive important information from NYSLRS in the coming year. If it’s been a while, you may need to look up your username or reset your password.  If you’re having trouble accessing your account, email us using our secure contact form or call our customer service representatives at 866-805-0990 (518-474-7736 in the Albany, NY area). Press 2 to access the retiree menu, follow the prompts, and then press 1 for Retirement Online assistance.

Public Pensions Give Economic Boost to Small Towns, Rural Areas

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Small towns and rural areas in New York and across the United States get an important economic boost from public pensions, a recent study concludes.

Public Pensions Give Economic Boost to Small Towns and Rural Areas Across New York

Why Public Pensions Give an Economic Boost

Because of their smaller economies, less-populated counties benefit more from pension dollars than larger, urban counties, according to Fortifying Main Street: The Economic Benefit Of Public Pension Dollars In Rural America.

In many small towns and rural communities, the report notes, school districts and local governments are the largest employers. Those public employees typically remain in their communities after retirement, and the authors attribute the economic boosts they found to pension dollars spent locally on goods and services.

Across New York State, public pensions were responsible for 1.6 percent of gross domestic product (GDP) in 2018. (GDP, the total value of goods and services produced during a specific period, is a common gauge of economic activity.) However, during the same period:

  • Wyoming County in western New York, where a handful of villages dot a rural landscape, saw public pensions generate 4.6 percent of GDP.
  • Hamilton County, with fewer than 5,000 people, received an economic boost from public pensions that accounted for 6.3 percent of GDP.

The study’s findings are in line with data showing the impact NYSLRS retirees have on local economies and other studies about the economic benefits of pensions.

Notes on the Data

Fortifying Main Street, which was released in July by the National Institute on Retirement Security (NIRS), examines pension data from 2,922 counties in 43 states. Based on criteria used by the federal Office of Budget Management, it divides counties into three main categories: metropolitan, small-town (or micropolitan) and rural. The study also analyzes data from counties that are home to the state capital, because these places tend to have higher numbers of public retirees. In Albany County, public pensions generated 2.7 percent of GDP.

Hamilton County is the only county in New York defined as rural in the study, but 16 counties, including Wyoming County, fit the “small town” criteria. You can read the full report on the NIRS website.

The study uses pensions paid by NYSLRS, the New York State Teachers’ Retirement System, the Teachers’ Retirement System of New York City and the New York City Employees’ Retirement System in its data for New York State.